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Luminex's Q2 Revenues Inch Up 1 Percent

NEW YORK (GenomeWeb News) – Luminex reported after the close of the market Monday that its second-quarter revenues inched up 1 percent as a decline in systems and consumables sales was offset by a sharp rise in assay revenue.

The Austin, Texas-based firm reported total revenues of $48.3 million for the three months ended June 30, compared to $47.7 million for the second quarter of 2011. It missed Wall Street's consensus estimate for revenues of $49.2 million.

Luminex reported system sales of $8.4 million, down 8 percent from $9.1 million year over year, as well as a 41 percent decline in consumables sales to $10.8 million from $18.4 million. Its assay revenue was $17.5 million, up 89 percent from $9.3 million, largely driven by the addition of EraGen Biosciences, now known as Luminex Madison, which the firm acquired in June 2011.

Luminex shipped 278 multiplex analyzers during the quarter including 167 Magpix systems.

Royalty revenues increased 4 percent in the quarter to $7.7 million from $7.4 million, and other revenues climbed 12 percent to $3.9 million from $3.4 million.

"We are pleased with our revenue progress, notwithstanding the significant decline in current quarter consumable revenue which was primarily the result of volatility in a single customer's purchases," Luminex CFO Harriss Currie said in a statement. "We anticipate improved revenue growth in the second half of 2012, as a result of both traction within our … product portfolios and easing consumable revenue comparisons."

Luminex posted net income of $3 million, or $.07 per share, versus net income of $4.6 million, or $.11 per share, for Q2 2011. Analysts, on average, had expected a profit of $.08 per share.

The firm's R&D spending increased around 22 percent to $9.6 million from $7.9 million, and its SG&A expenses increased 4 percent to $17.2 million from $16.5 million. The company recorded a cost of $1.1 million for amortization of acquired intangible assets compared to $602,000 for such items in the second quarter of 2011.

Subsequent to the end of the quarter, Luminex acquired molecular diagnostics firm GenturaDx for $50 million in cash and potential additional consideration based on milestones and/or product revenue performance. The additional milestone payments could surpass $10 million if certain revenue and regulatory targets are met.

"We are excited about GenturaDx technology and believe its simple to use, sample-to-answer platform combined with our proprietary MultiCode RTx chemistry will provide hospital-based molecular diagnostic labs with another powerful tool in their search for answers," President and CEO Patrick Balthrop said in the statement. "When this system is commercialized (anticipated for 2014) Luminex will be able to offer our customers with a broad line of product solutions to fit their specific needs."

Luminex finished the quarter with roughly $76 million in cash and cash equivalents.

Balthrop also noted that the firm has submitted a de novo 510(k) application with the US Food and Drug Administration for its xTAG GPP (gastrointestinal pathogen panel) assay.

Luminex reaffirmed its FY 2012 revenue guidance of between $205 million and $215 million.

Following the results and management commentary on a conference call, William Blair analyst Brian Weinstein downgraded Luminex's stock to Market Perform citing a lack of near-term catalysts.

In early Tuesday trade on the Nasdaq, shares of Luminex dropped 4 percent to $16.98.

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